Capital Call Agreement among Craig Sloan, The GSI Group, Inc., and Congress Financial Corporation (Central)

Summary

This agreement, dated July 2004, is between Craig Sloan (the investor), The GSI Group, Inc. (the borrower), and Congress Financial Corporation (Central) as agent for lenders. It requires Craig Sloan to provide financial support to The GSI Group, Inc. if its available funds fall below a set threshold, either by investing in the company's stock or by purchasing subordinated loan interests. The agreement remains in effect until all obligations under the related loan agreement are paid in full and may be enforced by the agent on behalf of the lenders.

EX-10.10 4 doc4.txt CAPITAL CALL AGREEMENT ---------------------- THIS CAPITAL CALL AGREEMENT (this "Agreement") is entered into as of July --------- ___, 2004 among Craig Sloan, an individual (the "Capital Call Investor"), The --------------------- GSI Group, Inc., a Delaware corporation ("Borrower"), and Congress Financial -------- Corporation (Central), an Illinois corporation, in its capacity as Agent for Lenders (as defined in the Loan Agreement defined below) ("Agent"). ----- RECITALS A. Reference is made to that certain Loan and Security Agreement dated as of the date hereof among Borrower, the Persons named therein as Guarantors, Agent and the Persons signatory thereto from time to time as Lenders (as from time to time amended, restated, supplemented or otherwise modified, the "Loan ---- Agreement") pursuant to which Lenders have agreed to make Loans to, and incur ------- Letter of Credit Accommodations for the benefit of, Borrower. All capitalized terms used but not otherwise defined herein have the meanings given to them in the Loan Agreement. B. The Capital Call Investor has a substantial ownership interest in Borrower, and, as such, benefits from the credit facilities made available to Borrower under the Loan Agreement. C. In order to induce Agent and Lenders to continue to make the Loans and incur Letter of Credit Accommodations, the Capital Call Investor has committed to provide Excess Availability support to Borrower (either in the form of common equity or subordinated participation loans) upon the terms and conditions all as more fully described herein. AGREEMENT NOW, THEREFORE, in consideration of the foregoing and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Capital Call Investor, Borrower and Agent hereby agree as follows: 1. Capital Call Commitment. From and after the date hereof through the ----------------------- Termination Date (as defined in Section 8 hereof), the Capital Call Investor shall make or cause to be made from time to time an investment (the "Capital ------- Call Investment") in Borrower upon demand by Agent at any time when Excess ------------- Availability is less than $5,000,000. Each Capital Call Investment shall be in -- an amount sufficient to cause Excess Availability to be at least $10,000,000 (the "Required Investment Amount"). Agent may make demand for the Capital Call Investment at any time and from time to time from and after the date hereof through the Termination Date. The Capital Call Investment will be made in accordance with Section 3 below not later than ten (10) days after demand by Agent (the "Capital Call Date"). ------------------- 2. Representations and Warranties. The Capital Call Investor represents, -------------------------------- warrants and covenants that: 1 (a) the execution, delivery and performance of this Agreement is a legal, valid and binding obligation of the Capital Call Investor enforceable against him in accordance with its terms, except as the enforcement thereof may be subject to (i) the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar law affecting creditors' rights generally and (ii) general principles of equity (regardless of whether such enforcement is sought in a proceeding in equity or at law); and (b) he has, as of the date hereof, and shall, at all times prior to the termination of this Agreement, maintain available capital to call in an amount sufficient to enable it to honor its obligations hereunder. 3. Third Party Beneficiary. The Capital Call Investor acknowledges ------------------------- that Lenders are third party beneficiaries of this agreement and that Agent is entitled to enforce the same on behalf of Lenders. 4. Investment Mechanics. On or prior to any applicable Capital Call Date, --------------------- the Capital Call Investor shall either (a) make an investment by purchasing common stock of Borrower for an aggregate consideration equal to the Required Investment Amount, which amount shall in turn be used by Borrower to prepay the Revolving Loans or (b) enter into a junior participation agreement in the form of Exhibit A hereto pursuant to which he shall purchase subordinated participation interests in the outstanding Revolving Loans in an amount equal to the Required Investment Amount. 5. Governing Law; Successors. This Agreement shall be governed by the --------------------------- internal laws of the State of Illinois and shall bind and inure to the benefit of the parties and their respective heirs, successors and assigns. 6. Entire Agreement; Amendments. This Agreement constitutes the entire ------------------------------ agreement and supersedes all other oral or written agreements among the parties hereto with respect to the matters covered hereby and thereby. This Agreement and the terms hereof may only be modified, amended, supplemented or waived by the written agreement of all parties hereto. This Agreement shall constitute a Financing Agreement. 7. Counterparts. This Agreement may be executed in one or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 8. Termination. This Agreement shall terminate upon the payment in full ----------- of all Obligations and the termination of the Loan Agreement (the "Termination Date"). [SIGNATURE PAGE FOLLOWS] 2 S-4 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written. CONGRESS FINANCIAL CORPORATION (CENTRAL) By: Name: Title: THE GSI GROUP, INC. By: Name: Title: Craig Sloan, individually and not as a director or officer of The GSI Group, Inc. 3 4 EXHIBIT A FORM OF JUNIOR PARTICIPATION AGREEMENT [Attached] 4